tv All In With Chris Hayes MSNBC May 17, 2013 5:00pm-6:01pm PDT
progressive action by the government agencies and trouble shoots problems. you shouldn't have to read in the paper that someone screwing up shouldn't have to learn secondhand about what the justice department is up to. offense and defense. he needs a team that can deliver on both. thanks for being with us. all in with chris hayes starts now. good evening from new york. i'm chris hayes. thank you for joining us on this friday. news out of the white house that can have major implications from the foreign policy. also, the single most draw-dropping foreclosure, that i have ever heard. first, scandal gate week continued. it continued with a vengeance in
washington today. steven miller was called up to capitol hill. he was to talk about groups for heightened scrutiny. the president asked miller to resign earlier this week but that could not spare miller from being served to house republicans like a pig for slaughter. a classic bit of washington hearing important, substance, not so much. grand standing? you bet. >> why did you resign? >> how can we conclude you did not mislead this community. >> i will help give you clarity. >> still doesn't know why he was question number 26. >> completely failed the american people. >> why are you resigning. >> as eric eriksson tweeted, allowing crappy congressman to look like conservative badass es. let me be clear, we are just getting started.
heritage action for american, wing of the think tank the heritage foundation, wrote that banter instructed house republicans to forget about legislating and go all scandal all the time. quote, it would be imprudent to do anything that shifts the focus from the obama administration to the ideological differences twn the house republican congress. while that is enough to make your head want it explode, i have a theory that i've been working on all week and i think it is true. and a theory that has a promising conclusion. it may well be that the government doesn't have to choose between the scandal mongering and legislating. but the scandal mongering might help with the scandal mongering. progress was what speaker john
boehner worried about just yesterday morning. >> i am concerned the bipartisan group has been unable to wrap up their work. >> there was a lot of question about whether this group was going to hit their deadline. whether they would come to any kind of agreement. and late last night, the bipartisan group announced they had mostly come to agree on terms for their outline of comprehensive immigration reform. from what we know, which is truthful truthfully, very little, it would be similar to what we know on the principle and senate and more conservative. what makes this announcement so huge is that while the house's gang of eight has been toiling away from behind the scenes for the last four years, with much less attention than senate is, it has been very, very unclear and to some very unlikely they were ever going to be able to agree to anything. but they did. and that's a very big deal. here is why scandal fever and incomprehensive immigration reform are related. republicans have this problem. they lost the 2012 vote by 44
point. a truly astonishing margin. latinos are fastest growing part of the electorate. republicans recognize their stance on immigration is a huge impediment to closing margins. basically everyone at highest levels of gop recognizes that. consultant class. donor class and politicians themselves. but they still have the same base they've always had. and believe me that base is not psyched about immigration reform. 60% of republican voters oppose a pathway to citizenship. republicans still have the same base that got riled up the last time congress tried to pass comprehensive immigration reform in 2007 and blow it up. so if you are a republican, you've got a problem. you're trapped between the two big challenges. you have to get right on immigration reform but do it without taking on your base. now, enter the irs scandal. now if you are, stay, paul ryan, who is at the hearing today and also a friend of the house's gang of 8 immigration reform, can you go around beating the
living crap out of the administration about benghazi and then go back and try to make immigration reform happen. the great thing for you is talk radio will only talk about scanned scandals. rush limbaugh mentioned ir sirs8 times. benghazi 85 times. ap 533 times and immigration 14 times. this is the perfect setting for republicans to legislate and use these scandals as cover. in other words while everyone in washington this week is asking, will scandal destroy obama's second term agenda? these scandals might be the best thing that ever happened to obama's central legislation priority for immigration.
robert, i will begin with you and ask your response of someone who knows the house caucus very well. >> i think it is a good argument, well argued. >> that's very kind but don't hold back. >> i was on capitol hill today huddling with leadership sources and you're right, they are very much consumed with the irs, benghazi and ap. but the resistance to the gang of 8's bill that's coming out of the senate and resistance to the house bipartisan groups bill is still there. those who run the conservative flank, steve kings of house of republican congress, they will still try it kill this, chris. as much as there is a scandal distraction, there is still the resistance. >> were you surprised that the house gang of 8 came to terms
today? was that something you were expecting or is that a turn of events. >> i think you are on to something, actually. i completely agree with you. i think this scandal is basically given the heritage foundation some coverage. they add really bad week. they need the scandal. they don't want congress senators or representatives to legislate. in fact, that's what they are doing. one of the incredible things happening on capitol hill is you've got senators, republicans and democrats who are sitting down, rolling up their sleeves and engaging in common sense immigration reform debate. on the house side, i think they feel the momentum we feel in the immigrant community. we know that the american public is so much further ahead than our policy makers. on many issues. the fact this they reached agreement in principle, we don't have the details of that. but it is very significant. >> real quick. >> please. >> one thing i heard from senate sources is that the senate deal
itself is to fragile that if the house conservatives and house republicans mess for instance with the time line for the path to citizenship making it 15 years instead of a lower number, that can ruin the senate compromise. so it is on thin ice is. it seems like immigration reform with the blessing of paul ryan is moving ahead, you can see it is steaming forward a little bit but it has such a long race ahead of it, i'm doubtful will scandals will release the skids. >> i think it is remarkable what is happening here. you've got what will be the most significant legislation and one of the most significant in a generation if it happens. it is like people trying to build a jenga tower in the middle of a crowded dance floor. they are trying while everyone is going all over the place. there is all this energy. and you're right when you use the word delicate, robert. i absolutely think that's the case. the question is, it is so
development that these little incremental changes seem to me to make a big difference. and you were talking about the good lots and steve kings. they will try to kill this no matter what. what i'm interested in, is go is going after the giving the space they need. are they the ones that bridge the gap, is having a thing they can talk to rush limbaugh about take pressure off them if they are also in the afternoon going to negotiate on the immigration bill? >> that's a great point, chris. one thing, i follow marco rubio around at a recent conservative conference and he was being slammed interview after interview by conservative talk radio. he was having a tough time the past month. now he is out there talking about the irs, the quote culture of intimidation within the obama administration. i think your point is a good one. i'm not saying i think it'll make sure immigration passes. but mark why rubio is in a
different position right now because they are cheering him as he goes after the white house. and it may be like your rush limbaugh studies shows. maybe let more negotiations happen. >> oofr r and here is a great recommendation to this. mark zuckerberg is trying to respond to this. they are running ads for lindsay graham that have nothing to do with immigration. they are just trying to cover his right flank and make sure he doesn't get a real nasty tea party challenge. take a look at this ad. >> when lindsay graham is in washington, what does he do? he stand up for south carolina values. >> change you can believe in after this healthcare bill debacle has become an empty slogan. and it is replaced by shady politics when you think about it. >> i'm not going to be intimidated by this president.
what i am suggesting is that we work smart and together. we are about to spend a trillion dollars sometime tonight, maybe. if this is change we can believe in, count me out. >> call senator graham. tell him to keep fighting for south carolina. >> the only reason this ad is being run is to get in the face of immigration. when you see the ad, are you in the mind of whatever means necessary to get this thing done? if this is the message you need to give him the room he needs to craft this legislation and move it forward, then that's the price you got to pay. >> as a progressive, i'm not necessarily in favor or against that. but i have to say, you know, the dynamics, chris, are incredible. senator graham and many of his republican senators are getting a lot of love from many folks in the immigrant rights community and for many, many folks. there is a sense we want to give cover to those policy makers who are willing to engage in common sense immigration reform.
and folks like sessions and perhaps good lott and cruz for example, are outliars. they just haven't gotten the memo that it is time for them to get immigration reform done and there will be consequences for both democratic and republican elected officials who do not vote in favor of immigration reform. it does matter what kind of immigration reform we get, of course. >> and robert you made that point in the difference of the basic time span of path to citizenship years is two years longer out of the house and senate. >> absolutely. >> and whether that the drunken stumbling on to the jenga tower that knocks the thing over, that the big question. i still think the odds of something getting past have gone up during week. some what counter intuitively. thank you both. have a great weekend. >> thank you. an amazing admission before
an update tonight on a story we've been following. the collapse of the garment factory that killed more than 1 is 100 people last month in bangladesh. the washington post reports the obama administration is considering revoking money saving bangladesh currently enjoys which caused the country to save $35 million last year. the u.s. won't tolerate such unsafe working conditions. the question remains will revoking tariffs improve working conditions in bangladesh or will major brands move their manufacturing as they have in the past. we will continue to follow this story here and on our website.
for sein a whole new way. for seeing what cash is coming in and going out... so you can understand every angle of your cash flow- last week, this month, and even next year. for seeing your business's cash flow like never before, introducing cash flow insight powered by pnc cfo. a suite of online tools that lets you turn insight into action.
all right. this week, a scoop, a new bit of information that caught my eye in "newsweek" by reporter daniel cladman that suggest the white house is about to do something it has resisted for years. the president is now about to deliver a speech, probably there week, on drones, guantanamo, national agenda and legal foundation for the continued global war on terror. he writes, in coming days, obama plans to lay out a legal framework for the administrat n administration's evoksing strategies on targeting detention and prosecution. the delicate process of putting
together such a major presidential statement has apparently taken months and involvedardus wrangling. there is also increased domestic pressure on the president to close guantanamo where it has now been 100 days since 102 prisoners held there launched a hunger strike. today protesters demanding closure of guantanamo submitted a o petition to the white house. a former military prosecutor at guantanamo and the person who started an on-line petition on-line. >> i urge you to take swift measures to humanely and lawfully's dress the immediate cause of the hung are strike in a manner consistent withn't national standard. quite a bit was revealed yesterday in a hearing before the senate armed services
committee that flew under the radar amidst talk about again gassy, irs and ap. pentagon leaders were question betd 2001 authorization to use military force, which is of course the resolution passed just after the/1 9 dsh /* /- 9/1 1. at least one member of congress was shocked by the breath of the assertions that were made by michael shee han, assistant secretary of defense for special operations in support of the grounding document for the unending open-ended global war we found ourselves in. >> i have only been here five months about this is the most astounding and astoundingly disturbing hearing i've been to
since i've been here. you have essentially rewritten the constitution here today. >> i don't disagree we need to fight terrorism. but we need to do it in a constitutionally sound way. >> barbara lee represents california's 13th district, only member of either house to vote against force. my first question is what did you make of this hearing yesterday? >> chris, first, thank you very much for reading the resolution. i hope the public will begin to listen to what took place. and that was a blank check that allowed for perpetual war until we repeal it. the debate that is occurring now should have occurred three days after the terrible event of 9 1 9/11. that delabate did not occur. now we see the senators hold hearings. we are beginning to hold forums. beginning to see the washington post, new york times begin to
editorialize on this. we are fining coming to grips with the fact that this blank check was a blank check which allows forward state of war to be the new norm. unfortunately, peace is the exception. >> pentagon leaders testifying yesterday, they asserted a very wide scope. is that surprising to you or pretty much what you expected and understood from the administration? >> well, the broad scope of the resolution is very broad. that's why i couldn't vote for it. we wrote to the president, eight or nine of us, and asked the president to really lay out the legal justification for the use of drones. this resolution has been used dozens of times abroad used to take troops into combat areas. it is such a blank check that
needs to be repealed. finally we will hear the president talk about legal justification for what is taking place. >> this is on the secretary of how long, this has been the question, since days after 9/11, the bush administration and into the obama administration, how long does this last? when can we say this is over? let's listen. >> do you agree with me that the war against radical islam or terror or whatever description you would like to provide, will go on after the second term of president obama? >> senator, in my judgment, this will go on for quite a while and beyond this term of the president. >> and beyond this term of congress? >> yes. i think at least ten to 20 years. >> so from your point of view, you have all of the authorization and legal forum necessary to conduct a drone strike against terrorists in
yemen without changing the emf. >> yes, sir, i do believe that. >> do you agree? do you think this war will go on 10 to 20 years? is that surprising to hear from the administration? >> not surrounding, but it is outrageous. i want it repeal this authorization to use force. come on, chris. we can't allow our systems of checks and balances to be eroded. only congress can declare war. are we in the state of perpetual war forever, then why can't congress debate and decide whether or not to declare war. i think we need to actually, hopefully, get the public to really understand that this overwhelmingly, unending war, is taking away precious resources from our nation building right here at home. >> the president is reported to be working on a speech. i just read you the report, in which there is a plan now apparently for the president to come out and actually address
all this head on. they haven't talked about it in a very public way. but the president himself hasn't add big speech on these issues. what are you hoping to hear when he does come out and talk about this? >> first i have to applaud the president for doing this. this is exactly what we asked him to do a couple months ago. this wasn't a blank check that i voted against as it relates it president bush. but any future presidents will have this broad authority. i hope the president will lay out the legal justification and why the wlous believes in the pentagon believes they can continue to allow our country in this state of perpetual war without coming to congress. we cannot relent as members of congress. the president is the commander-in-chief. he has to secure our country and make our country safe. we as members of congress as it relates to our system of
democracy, we have a duty and responsibility to debate and ensure that checks and balance prevail. that's exactly what needs to happen. hopefully the president will lay it out and members of congress will understand we have to do our job. >> congresswoman barbara lee, thank you so much for joining us. >> thank you. >> okay, liberals, are you watching? i need to talk to you. there is something we are not seeing eye to eye on. i want it make my case. so let's talk, next. new car!
is this still america? is this government so drunk on power that it would turn its full force, its full might to harass and intimidate and threaten an average american who only want her voice and their voices heard? mr. miller, who in the irs is responsible for targeting conservative organizations? >> that was some world class um bridge taking while drilling the soon to be former irs chief steven miller. you probably thought, as i did, while watching him, relax, buddy. you probably have been feeling that way all week as it what we in the office has taken to call scandalgate. with the ridiculous benghazi talking point and ultimately
what appears to be bureaucratic failure at the irs. as a liberal, it is easy to get your dander up and say hey, guy webs back off. these are not scandals. there's another one i think we should talk about. in fact, you know what, come closer. there we go. i understand gouting the brain of the washington media complex of bundity on cable news, politicians grand standing about scandals. particularly in this kind of scandal season when scandals are holy invented but we cannot let that mind us to what the stakes are in another really trouble sum episode. what the department of justice did in seizing two months of phone record and 20 calls from associated press phone lines. i want to take a second to explain why this matters and why it is a big deal and why it is outrageous, what the doj did. in march 2 00 of, the associated press reported on a confidential videotape showing federal officials warning president bush and homeland security chief
before hurricane katrina struck that the storm could breech new orleans levees. in 2005, an ap investigation found top lobbyist appealing to some three dozen members of congress to right to interior secretary gail norton blocking a casino in indiana that had other tribes that hired him. in order to keep it t secret, whisking getting him out of gitmo. that is just a few of the malfeesance or incompetence tense. stories brought to you. those stories took a chance, identified wrongdoing, found a secret that shouldn't be a secret and believed that we should know about it. those people spoke to reporter with a trust that their secrets could be protected and they wouldn't face humiliation and recrimination. think of every source that every ap reporter has right now and
whether they are going to trust the ap again. think of someone right now who might be sitting on an army base who knows about a serial sexual predators at a high level who want to blow the whistle and is terrified after reading call logs that the government is in the same area that they want to blow the whistle on. every sixth possible news source ease well as the news source itself. barack obama is not going to be president forever. after him there will be others. it is a core function of democracy in the first amendment. we have an oppositional press trying to find out things that the government doesn't want to know and we can't allow them to have the power to destroy the press's ability to do that. on twitter and facebook, i've seen a fir number of liberals and democrats come to the department of justice's defense and say what eric holder and
president obama's has said about the week. >> it putting the american people at risk. that's not hyperbole. you put the american people at risk. >> leaks related to national security can put people at risk. >> it is important to remember this is always what presidents and officials say about leaks to journalists. some less eloquently than others. >> i'm going to tell you something. leaks of classified information are bad things. >> we can't just take these aversions at face value because we have no independent way to know what to agree and in what instance. we need the press to tell us stuff the government doesn't want us it know. the only things we will learn about the massive ever expanding secret government are things that make that government look good. obtaining a massive trove of phone record is more than just a
one-off happenstance. it constitutes a terrify oing precedent for future administrations. when you're watching this unfold, take a moment to ask yourself honestly, how you would feel if george w. bush is the one doing it. we will be right back with click three. all business purchases. so you can capture your receipts, and manage them online with jot, the latest app from ink. so you can spend less time doing paperwork. and more time doing paperwork. ink from chase. so you can. [ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients
but with advair, i'm breathing better. so now i can help make this a great block party. ♪ [ male announcer ] advair is clinically proven to help significantly improve lung function. unlike most copd medications, advair contains both an anti-inflammatory and a long-acting bronchodilator working together to help improve your lung function all day. advair won't replace fast-acting inhalers for sudden symptoms and should not be used more than twice a day. people with copd taking advair may have a higher chance of pneumonia. advair may increase your risk of osteoporosis and some eye problems. tell your doctor if you have a heart condition or high blood pressure before taking advair. ask your doctor
if including advair could help improve your lung function. [ male announcer ] advair diskus fluticasone propionate and salmeterol inhalation powder. get your first prescription free and save on refills at advaircopd.com. while congress was busy holding hearings over an alleged scandal in washington today, we were learning about one of the most tragic foreclosures. that's next. first, the three awesomist things on the internet today. first, the bizarre story of toronto's mayor. a cell phone video currently is being chopped around showing ford going full on marion barry and smoking crack cocaine. ford denies the allegations. the video is not public. fortunately, there is this dramatization offered. tape.onto mayor rob ford ca
>> let your imagination run wild with this depiction of ford partying along side a hockey player, wood chuck and mounty. if you think this is unbelievable, there are some bizarre things this guy has done in real life. including abruptly leaving a meeting to put magnet on people's cars. he calls the allegations ridiculous. a it should be no surprise that even obama's umbrellas are a joke now. sarah palin posting, mr. president, most americans hold their own umbrellas.
and semperdry. a male marine is not allowed to carry an umbrella while in uniform. before your head explode, please check out the post from a u.s. marine about barack obama's shocking and disgusting use of an umbrella. because this is a family show, i can't read you what is written. we have your feel good friday moment. the-year-old alana adams throughout the first pitch at the rays/red sox game. first, a prerecorded pep talk from her father, lieutenant colonel will adams. alana's pitch fell short and that's when the guy behind home plate dressed in full rays gear grabbed the ball, lifted up his mask and he wasn't a catcher but alana's dad. needless to say, it was a surprise for the whole family.
an overjoy joyed crowd got to witness this reunion from a father and daughter. this video went viral and i was in my office crying watching this video. we'll be right back. hey. whassup. guten tag. greetings earthlings. what's crackalackin? it's great we express ourselves differently. if we were all the same, life would be boring. so get to know people who aren't like you. you'll appreciate what makes us different. the more you know. i'm also a survivor of ovarian a writand uterine cancers. i even wrote a play about that. my symptoms were a pain in my abdomen and periods that were heavier and longer than usual for me.
the first technology of its kind... mom and dad, i have great news. is now providing answers families need. siemens. answers. are proven to be effective pain relievers tylenol works by blocking pain signals to your brain bayer back & body's dual action formula includes aspirin, which blocks pain at the site. try the power of bayer back & body. with the innovating and the transforming and the revolutionizing. it's enough to make you forget that you're flying five hundred miles an hour on a chair that just became a bed. you see, we're doing some changing of our own. ah, we can talk about it later. we're putting the wonder back into air travel, one innovation at a time. the new american is arriving.
i wa s ha ving an affair with greek nonfat yogurt, 0% fat packed with protein thick and creamy look i'm in a committed relationship with activia and i've been happy now with activia greek i can have the best of both. activia greek. ♪ dannon whoa, wait for me! oh no! my mom just cleaned this place! calm down, squishy, this'll be easy to clean. [ female announcer ] swiffer wetjet pads have the scrubbing power of mr. clean magic eraser. they trap and lock away even monstrous messes to make tough cleaning a breeze. now that's clean. wow. scottie! we won! uh-huh, uh-huh. mom?!! [ female announcer ] swiffer gives cleaning a monstrous new meaning. monsters university, in theaters, in 3d. in a week of scandals, i want to tell you the most
scandalous story i heard this woke. a story for scandalous than anything else out of washington. it made my face flush with race. a 62-year-old disabled veteran whose neighbor and friend filed suit this week against wells fargo the bank that owned his mortgage for wrongful death. he died in december in a courtroom during a hearing challenging his foreclosure with wells fargo. and he never should have been in this court to begin with. we have reported quite a bit on this show about the absolute systemic error, malfeesance and corruption in the foreclosure. larry, pictured here at his assisted living facility where he lived after he lost his home. bought that home in 1995, 3 to hermosa avenue, unit 25, hermosa beach, california. his hires mortgage which latered
went to wells fargo was for 13 years. and he never missed a payment. in 2007, he refinanced, into one of the most predatory kind of loans called a pick a payment. now considered to be among the most predatory and deceptive loans made during the height of the housing bubble. the new loan meant that he was now paying 75% of his disability just to make his mortgage. and so, he started collecting cans and bottles to help make end meet. but he still made the mortgage payments, according to the complaint and according to review of court documents. in fact, he had a habit of making payment in advance. and the straw that broke the camel's back is the let are saying he owed $13,361 in back property taxes that was false. the subcontractor hired by the bank to assess property taxes
mistook his lot number for a neighbor's. that subcontractor used the wrong lot number. so here he is, disabled veteran, making those payments, grinding it out, refinanced into a predatory loan during the peak of the boom years. still making payments by collecting cans. then told he owes $13,361 in back property taxes that he did not actually owe. eventually wells fargo would acknowledge they made a mistake and they still held him in default and took his home from him. selling it on may 13, 2011 for a profit of $17 8,257. now the precise facts of that default are in dispute. it is entirely possible that the default originated in the fact that he add habit of making payments early and his last payment was misapplied. but what is not in dispute is that in december 19, 2012, he was in that court hearing having watched his entire home be taken away from him and the stress of it, the lawsuit contends, killed
him. he add blood condition that the lawsuit argues increases the level of ammonia his body cannot handle. and right along with stress. the lawsuit is stress and breech of contract. in calling wells fargo for amount responded, wells fargo received inaccurate information that led to a tax overcharge. when that mistake was discovered, we reversed all of the charges and as the court ruling stated put him in the same or better position prior to the error. in a sworn deposition he clearly and honestly stated that his default was not related to the issue regarding the property taxes. he was reviewed for a
modification but we were unable to find an option for him. >> at the same time, pursuing foreclosure procedures, th is part of the massive settlement between the attorneys general and the big banks. this may seem like an extreme case, and it is, but there was an official investigation by federal regulators that found that 4 million homeowners were wrongfully closed upon or victims of short of foreclosure. members of the armed services were wrongfully foreclosed upon. there were people who were foreclosed upon who never missed a statement. had their homes taken away. there are stories all over the country everyday. but and here is the good news, one nonprofit in boston figured out a way to do this right that actually figured out how to keep people in their homes as productive members of society. and we are going to tell you about the magical trick they figured out right when we come back. r! mamake a wish!h! i wish w we could lie e here forevever.
i wish thihis test dririve was , so we e could headad back to thehe dealershihip. [ [ male annououncer ] it's p practicallyly yours. testst dri! bubut we stillll need your s signature.. vovolkswagen s sign then d drie is back.k. and d it's neverer been easisir to get a j jetta. that's t the power of german n engineerining. get $0 dowown, $0 due at t signing, $ $0 dep, anand $0 firstst month's p pt on any n new volkswawagen. visit vwdedealer.com t today.
available out there. i knew devry university would give me the skills that i needed to make one of those tech jobs mine. we teach cutting-edge engineering technology, computer information systems, networking and communications management -- the things that our students need to know in the world today. our country needs more college grads to help fill all the open technology jobs. to help meet that need, here at devry university, we're offering $4 million dollars in tech scholarships for qualified new students. learn more at devry.edu. do you want the long or short answer? long i guess. chevy is having a big...huge, in fact...event. the-great-deals-on-our-most- fuel-efficient-lineup-ever- for-just-a-very-short-time-so- you-better-hurry-extravaganza! so what's the short answer? awesome. [ male announcer ] the chevy memorial day sale. now, combine current offers
for a total cash allowance of $2,500 on a 2013 chevy malibu. foour neighbors.... and our communities... america's beverage companies have created... a wide range of new choices. developing smaller portion sizes and more.. low and no-calorie beverages... adding clear calorie labels so you know... exactly what you're choosing... and in schools, replacing full-calorie soft drinks... with lower-calorie options. with more choices and fewer calories... america's beverage companies are delivering.
we just told you about one of the most jaw dr-dropping ag l egregious stories about foreclosure ever. if you missed it, look it up on our website. now a nonprofit found a way to keep people in their homes and communities in tact. using a 25 million loan to buy homes from people in default or subject to foreclosure and reselling the homes back to the owners at affordable mortgages. joining me now, chief executive elise cherry and derek harper, a homeowner at risk of foreclosure and helped by the program.
welcome. walk my through. housing finance is deathly dull and confusing. but people staying in their homes is awesome. so explain to me how you're using -- how finance is keeping folks in their homes. >> sure. let me see if i can thread this needle. >> thread the needle. >> when we looked what is was going on in boston and surrounding cities, housing was skyrocketing and people's income was flat. >> let me stop you there. you are one of many groups working in communities during the housing bubble who picked up on this. the federal reserve completely clueless, wall street, totally clueless. i have sat across from folks like you in places like north carolina and scottsdale, arizona who saw this coming, before all the big wigs did, because they saw exactly what was happening at ground level. >> that right. my least favorite example, we add hair dresser full-time making $23,000 a year. her mortgage was $235,000.
she could have put every cent of every dollar she made into the mortgage and she would never pay it. as the bubble grew and crashed, what we could see is housing in the neighborhoods were not sustainable. people were quite sustainable but the prices needed to come back down to turn the market prices. and there was a huge differential. so a home maybe $400,000, this is boston after all, during the bubble, might be down to $200,000 in terms of it's real value. if we can go out and raise plan to buy a group of these homes and sell them back to the homeowners, maybe we can not only stabilize the homeowner but stabilize the neighborhoods. >> so the idea is i'm a homeowner. i'm way in over my head. under water on this mortgage because i refinanced during the boom years or i bought the house during the boom years and the mortgage is $400,000. the house is worth half that. you guys come in, buy it and sell it back to me with a mortgage for $200,000 and that i can afford.
>> correct. >> so derek, where were you living? >> hyde park massachusetts, a section of boston. i'm a social worker. i contract my services out. but the agency i was with wouldn't pay me. i would go for months on end not getting paid. or getting partial payments. my wife, x-ray check, we fell further and further behind. at one time i owed $50,000 in back payments and penalties and fees. th then the recession hit. the house was under water. we couldn't sell it. it was worth half of what they said it was worth before. trying to work with the bank. they wouldn't offer anything we could handle. so we tried. i almost became an expert on how to write letters and research and who to talk to. >> this is something i have heard -- i've done dozens, probably hundreds at this point
of interviews, of folks going through foreclosure. so what you have to do back and forth with the bank is astounding. a full-time job. >> yes, absolutely. my a friend of mine told me about an initiative of boston capital. essentially they saved our home. i thought i was going to lose my home. only thing i have to leave to my children is my home. i thought we were going to lose it. i can't imagine paying the back mortgage. >> that's your only -- that's your chief asset. >> that's it. my only asset. they came in, they did a short sale with the bank. and then sold it back to us at an affordable rate. >> with a new mortgage. >> new mortgage. it is about a year and half and we are going strong with it. >> so the question is, this isn't magic. someone is taking that loss. who is taking that loss? >> well, there are two halves to
this. one is the loss and the second is where do you get the cash in the first place it create the mortgage? in terms of the loss, what we try to do is we buy from a lender at exactly the same market price anybody else would sell it to them act. the fact that it goes back to the homeowner doesn't increase the size of the loss. >> someone is going to take the loss no matter who buys it. may as well be the homeowner. >> so we know when we offer current market price, the challenge is you have to have cash to do that with. so we went out, we raised enough money primarily from foundations, high net worth individuals to make $50 million worth of mortgages. we put up $10 million of our own so because we wanted to be clear to folks that we were in there too. once we made those mortgages and we are at about $56 million, there had to be new source of capitol or we wouldn't be able to continue. >> right. >> up stepped boston savings bank. we said, look, in the entire rest of the residential mortgage industry, the way you achieve
liquidity, recycle your money, people buy the revenue stream from the mortgage. >> right. the whole way wall street worked is that no one held on to the mortgage. they sold it into another market. >> yes. though there are lots and lots of issues about that. we keep the risk of the mortgage. what we had was a situation in which every person we are lending to is in foreclosure. nobody wanted to buy the loan. >> why is this only happening in 75 homes when we have 4 million foreclosures. why is this not happening every why? >> first you need a source of cash. we think we sold that problem. not just with the primary investor, but we have a commercial bank say i can see they are prproperly underwritte.
we are willing to buy in. >> this is not a charity case. you are going out and saying this is a viable business model. >> that right. we are pushing up to 400 households. about 275 mortgages. but we are teed up to expand. >> what has this meant for your life to go from being, having this rock sitting on you of pressure to having your house back and having another shot? >> i was very depressed. my whole identity is providing for my family. you start feeling like a failure if you think you are going to lose your home. i started asking my wife, what is it going to be like. we were in that home for 13 years, 12 years, and we thought we were lose it. when they came in, it was like a huge weight off. and it is amazing. and my future is bright. and i have something i can leave to my children. >> you're talking about that just the experience of foreclosure and expie o
pressure of debt which is something you can't quantify. that's one of the biggest scourges and the scandal that we let it go on. really, thank you very much. this is a hopeful promising story. thank you for being here. t"the rachel maddow show" start now. >> happy friday. thanks for being with us. kind of a news day like only happens in the movies. the headline this morning was about a july heist in france. specifically specifically at the cannes film festival. there were jewels under a safe. they might have been things that movie stars were planting to wear at the film festival but that is now less likely. a professional gang of jewel thieves known as the pink panthers have hit this area in france in recent years.